No Advance Ruling can be sought to determine GST rate after receipt of SCN: Madras HC

Case Details: Saisanket Enterprise v. Authority for Advance Ruling, Commissioner Commercial Tax, Madhya Pradesh - [2022] 139 taxmann.com 470 (Madhya Pradesh)

Judiciary and Counsel Details

• • Vivek Rusia & Amar Nath Kesharwani, JJ.
  • Ajay Bagadia & Tarang Chelawat, Advs. for the Petitioner.

Facts of the Case

The petitioner was works contractor engaged in executing works related to construction of irrigation dam. The premises of petitioner was searched by authorities and evasion of GST was detected. A show cause notice was issued on petitioner calling upon to discharge GST liability at rate of 18% as applicable on works contract services.

After receipt of SCN, the petitioner approached to Authority for Advance Ruling contending that rate of taxes applicable to sub-contractor should be 12 % in view of Notification No. 11/2017 dated 22-8-2017. The Authority denied to grant the advance ruling and the petitioner approached Appellate Authority by way of filing an appeal. The Appellate Authority also dismissed the appeal and it filed writ petition against the same by submitting that no such proceedings were pending against the petitioner, therefore, Authority ought to have decided the issue raised by the petitioner regarding the applicability of the rate of tax.

High Court Held

The Honorable High Court observed that the petitioner approached to Authority for Advance Ruling after receipt of SCN. When issue was pending before Authority under GST Act, the Authorities had rightly declined to grant advance ruling as petitioner did not approach in advance before those Authorities for obtaining ruling. Thus, the Court dismissed the writ petition.

List of Cases Reviewed

• • Order dated 10-12-2020 passed in case No. 14/2020 by Authority for Advance Ruling, M.P. (para 9)
  • Order dated 26-7-2021 passed in case No. MP/AAAR/05/2021 by M.P. Appellate Authority for Advance Ruling (para 9) – Affirmed.